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from Local Attorney, Michael H. Wasserman

Tuesday, June 17, 2008

MORE ON AMERICAN INVSCO CONDO FORECLOSURES

Way back in March, I posted some comments on the foreclosure troubles at the Sterling Private Residences, a near-north high rise apartment building that American Invsco converted to condominiums. Today Crains gives statistics to something I "knew" and reported anectdotably back then: the foreclosure problem extends to many of its other conversion projects as well.

According to the story, eight of American Invsco's downtown towers have accounted for 57.7 percent of all foreclosure cases brought against original buyers in all 76 downtown condo projects of 175 units or more since 2001. (Invsco accounted for 12 percent of the homes sold in big downtown projects over the same period of time.)

Crains picks up on the same issue I did in this Spring (and back when clients were showing me contracts to review):
"Why do American Invsco buildings lead downtown Chicago in foreclosure cases? One explanation may be the role of investors, buyers who intend to flip or rent out their units rather than move in. Though most downtown developers courted investors during the recent condo boom, American Invsco crafted an incentive package with special appeal for investors. Not only did the developer offer to pay condo assessments and property taxes on its units for two or three years, in some cases it promised to pay rent as well, guaranteeing investors a revenue stream to help defray monthly mortgage payments."
the complete & gruesome story here.